The price premium for newly constructed homes compared to existing homes has fallen to an all-time low of just 7.8%. The median price of new homes is $450,797, while existing homes average $418,300. On a square-foot basis, new homes are often cheaper than existing ones, with costs of $218.66 and $226.56 respectively. Discounts are concentrated in the South and West due to weak demand. Despite a slowdown in construction activity, new inventory has expanded significantly, enhancing market affordability.
The median listing price for a newly built home in the second quarter of 2025 held mostly steady at $450,797, while the median existing-home price jumped 2.4% to $418,300.
New homes now typically list for $218.66 per square foot, compared with $226.56 for existing homes, which marks a significant affordability shift.
The biggest discounts in new home prices are found in the South and West, where weak demand has led builders to make price cuts.
We are seeing new-home price declines in some of the most active pandemic-era hot spots, indicating a shift toward greater affordability.
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